Salceda says taxes from sugar-sweetened drinks not making their way to sugar farmers

October 1, 2019
Charissa Luci-Atienza (Manila Bulletin) |

Disappointed that the country’s 62, 000 sugar farmers have not benefited from the taxes collected from companies selling sugar-sweetened beverages (SSBs), Albay Rep. Joey Salceda asked Tuesday the Department of Budget and Management (DBM) to make “institutional amendments” in the proposed 2020 P4.1 trillion General Appropriations Act (GAA).

The chairman of the House Committee on Ways and Means made the call during the oversight hearing on the earmarked funds from excise taxes pursuant to Republic Act 10963 or TRAIN Law.

“May I ask for a departmental errata before bicam? Can you send to the Secretary the request of the committee?” Salceda asked DBM Undersecretary Rolando Toledo during the hearing.

“We will be losing our moral ascendancy of imposing any further taxes if it doesn’t go to the intended beneficiaries,” he pointed out.

Salceda explained that the DBM can suggest changes “in any point and time” in the proposed budget.

Under TRAIN law, 15 percent of the incremental revenue from SSB should directly go to the sugar farmers.

Nueva Ecija Rep. Estrellita Suansing, vice chairperson of the House Committee on Ways and Means, expressed disappointment that the sugar farmers are being deprived of their entitled benefits under the law because the concerned government agencies have been remiss in their duties.

“I am so disappointed Mr. Chair because the projected revenue for this is P52 billion per year, but in the implementation, there is a problem. There is a problem in the registration of companies in the FDA (Food and Drug Administration),” she said.

The former chairman of the House Committee on Ways and Means said FDA failed to check whether or not the companies selling SSBs use local sugar or high-fructose corn syrup (HFCS). Under the TRAIN law, an excise tax of P6 per liter is imposed on drinks with caloric and non-caloric sweeteners, and P12 per liter on beverages using HFCS.

“The FDA is allowing corporation or company to register online and they don’t have capability of checking the item itself,” Suansing said. “The local farmers should not suffer…I assure them we will put some of the money to the sugar-producing regions, so ngayon nakakahiya naman nakita natin walang napunta sa kanila (it is a shame they did not receive anything)” she said.

During the hearing, FDA Director Marilyn Pagayunan admitted that they lack the capability to determine if the companies use HFCS.

“For determining if it is a high fructose corn syrup, there is a need for FDA to purchase or procure an equipment like ID detector and with the HPLC higher performance liquid chromotography). We are trying to determine those manufacturers who are lying,” she said.

Salceda said because of the ineffective implementation of the TRAIN Law, the government only collected P38 billion, instead of the projected P52 billion.

He laments that the law was “being implemented without understanding the legislative intent.”

“We identified in the law that sugar farmers is one of the (beneficiaries of the revenue from SSBs taxes, but sugar farmers were not funded at all. When in fact, farmers are one of the biggest contributors to the TRAIN through SSB,” Salceda said.